Deane Company has income from continuing
operations of $520,000 for the year ended December 31, 2014. It also has the
following items (before considering income taxes):
extraordinary fire loss of $140,000.
gain of $80,000 on the discontinuance of a major segment.
correction of an error in last year’s financial statement that resulted in a
$60,000 overstatement of 2013 net income.
items are subject to income taxes at a 25% tax rate.
(a) Prepare an income statement,
beginning with income from continuing operations.
(b) Indicate the statement
presentation of any item not included in (a) above.